April 5, 2010

Does Alabama’s Tax System “Redistribute Wealth”?


Last week, an Alabama legislative committee approved a bill, House Bill 1, that would take an important step towards making one of the most unfair tax systems in the nation somewhat less unfair. Some opponents of the bill have characterized it as a “redistribution of wealth” from the best-off families to low-income taxpayers. However, these opponents have got it exactly wrong: the Alabama tax system actively redistributes income away from those living below the poverty line and towards the state’s millionaires. HB 1 would reduce this “Robin Hood in reverse” effect somewhat, but would not eliminate it.

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